Sunday, May 17, 2015

Human capital development

“Philippines ranks 46th in human capital report,” Alden M. Monzon, Business World, 13th May 2015. “THE PHILIPPINES ranked 46th among 124 countries surveyed by the World Economic Forum (WEF) as those nations conducive to developing its human capital, particularly in the fields of education, skills development, and deployment.”

46th sounds good until one reads “in the 15-and-under age group, the Philippines ranked 73rd . . . 51st in the 25-54 age group.” Pleasingly, we do better, “20th in the 15-24 age group . . . 40th in the 55 to 64 age group, and 33rd in the 65-and-over group.”

The 15-and-under ranking so poorly at 73rd should deeply bother us. These kids haven’t done anything except to wake up in our broken system. And while not doing as badly, to be 51st in the 25-54 age group means that those that are more recent entrants or well into their careers need a get fairer shake. Which can only be a reflection of our inability to be competitive and attract FDI and industrialized and overcome underdevelopment.

And indeed we should miss the good old days: I averaged 13 months doing my first 4 jobs because jobs were aplenty. [And I was not even a diligent student, voted least likely to succeed by my high school class.] That must be what Steve Jobs meant when he spoke to Stanford graduates in 2005, “Stay hungry, stay foolish.” But our young people may not be getting that chance today? And we can’t just keep failing them!

Thankfully, this writer came across the following: “House OKs school feeding program,” Jess Diaz, The Philippine Star, 17th May 2015.“Approved on Wednesday night was House Bill 5618 or the proposed National School Feeding Program Act that aims to address incidence of malnutrition, declining academic performance and dropouts among school children.”

But we need more than that to fix a broken system. Again, thankfully, two articles somehow have thrown a ray of hope. “Bill seeks to shore up budget reforms past Aquino tenure,” Mikhail Franz E. Flores, Business World, 11th May 2015. And “Speaker: Economic Cha-cha among gov’t priority measures,” Paolo Romero, The Philippine Star, 16th May 2015.

“Clearly, the passage of this bill will fortify the government’s accountability to the people for its use of public funds through a more efficient public financial management that facilitates greater transparency and delivery of direct, immediate and substantial services . . . the measure seeks to bring the country’s public financial management system up to international standards.” [Flores, op. cit.]

“What matters now is to ensure that PFM reforms are sustained and even further escalated beyond the present administration . . . Under the proposed law, Congress will take on additional powers: monitoring and review of agencies’ spending performance; review of fiscal policy strategies and consider annual financial statements. Economic agencies such as the Department of Budget and Management, Department of Finance and the National Economic and Development Authority will likewise prepare reports which will outline the government’s fiscal strategy in the near-term, medium-term and long-term.”

“The proposal to ease the restrictive economic provisions of the Constitution is just one part of a bundle of reform measures prioritized in the House of Representatives to ensure the economy will not slide back into a boom-bust cycle, Speaker Feliciano Belmonte Jr. said.” [Romero, op. cit.] “We need a well-crafted law that focuses on economic efficiency rather than on size and market structure alone, and which address improper business conduct and excessive and harmful market power that result in the reduction of output or increase in price,” Belmonte said.”

“While I understand that such amendments do not constitute the only solution in attracting more investments, I believe that it is high time that we worked to attune and adjust our economic policies more strategically to the needs and demands of our time,” the House leader told members of the Philippine Bar Association on Thursday.

“On the final stages of approval is the Anti-Trust Bill or the proposed Philippine Competition Act, which seeks to dismantle monopolies and prevent unfair competition.”

It may be too early to celebrate these new initiatives by our legislators. Beyond the credibility issue that they can’t just shake off, a similarly big question is are we as a people indeed predisposed to reform? Or does ideology remain a stumbling block as well?

“Politics is big ‘business’ here at home (!), Bobit S. Avila,” SHOOTING STRAIGHT, The Philippine Star, 14th May 2015. “A good friend, Romy Ronquillo sent me a report from Money Magazine where its editor Kurt LaVine said, ‘If Philippine Politics can only be listed as a public corporation, more investors will pour their money to more of the most profitable businesses in Asia.’ Phil. politics listed at US$10 Billion is the 2nd most profitable business in Asia, beating Toyota and Samsung.”

“Department of Justice (DOJ) Secretary Leila de Lima already said that she is not prioritizing the filing of cases against the 3rd Batch of Senators and Congressmen who are in the list of the so-called Janet Lim Napoles files. This is why corruption in this country especially the ones committed by those so-called “Honorable” politicians (and allies of Pres. Aquino) could never be eliminated because the people tasked by the State to hunt down the corrupt and the damned and throw them to jail just don’t care.”

As if politics aren’t hurdles enough, we also have questions like “Why we should want free trade,” BusinessMirror Editorial, 10th May 2015.“There are also those that believe that the oligarchs, the large companies that have a ‘too-large’ a share of Philippine business, do not want the competition from free trade. If that is true—and we are not saying it is—then both the Left and the oligarchs have the same goal of wanting the people to be dependent on either ‘big business’ or the government for their economic prosperity.”

“Without free trade between nations, we face the condition of autarky where an economy depends on consuming only what it produces and producing only what it consumes. That generally works badly as North Korea is the best example of autarky. People and nations depend on each other through trade for their economic well-being. Try raising your own chickens if you doubt that truth. The division of labor among people and among nations is the essence of civilization.

“Trade is the ultimate example of cooperation between nations. Otto T. Mallery, a late 19th-century economist in his 1943 book Economic Union and Enduring Peace, states, ‘If soldiers are not to cross international boundaries, goods must do so. Unless the Shackles can be dropped from trade, bombs will be dropped from the sky.’”

Conflicted as we are about trade is, surprise, surprise: “The Philippines is experiencing continued declining competitiveness despite the passage of the AFMA 17 years ago. And while agricultural exports are increasing, the pace of importation is so much faster, thus widening the trade gap even further.” [Lame efforts to reform agriculture sector, Rey Gamboa, BIZLINKS, The Philippine Star, 14th May 2015.]

“An in-depth look at the situation reveals only one problem: inadequacy of government to deal with the challenges and issues. We have a law – in fact, several laws covering agriculture, some of which have been on the verge of conflicting – that has remained lame through the years. Despite the many studies in past years that attempted to pinpoint the major problems and their solutions, nothing substantial has happened.”

How do we learn to change?

“The pope said that he was, indeed, a changed man, as John L. Allen recounts in his new book, ‘The Francis Miracle.’ The pope said he was filled with ‘interior freedom and peace, and that sense has never left me.’” [Pope Francis and the Art of Joy, Timothy Egan, The New York Times, 15th May 2015]

Genesis of this Blog

Now a book

Advocacy

About Me

I started writing to columnists and newspaper editors at the end of a trip to the Philippines over Holy Week in 2008 – to echo the frustrations expressed by friends and relations that were much louder and more intense than prior trips. My first thought was: with so much talents and skills how could the country be the basket case of Asia? Are we simply too nice as a people? Since then I have kept abreast with local news and opinions.
I have been a business consultant (since 2003) focused on Eastern Europe. My principal client in Bulgaria, a consumer-products maker, was chosen by the European Business Awards in 2011 as among Europe’s best from the 15,000 companies vetted for the selection. I started my career in 1968 in human resources in the Philippines. I then joined a Fortune 500 company in 1981, working with its Manila subsidiary for seven years and later moved up to its Asian regional headquarters and finally assumed a global responsibility (in global strategy, organization and business competitiveness) until my retirement. I have likewise done consulting work in the Philippines. I live with my family in Stamford, Connecticut, USA.